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Student loan selloff: how will it affect you?

Feb 07, 2017

Student loan selloff: how will it affect you?The government's decision to sell off student debts is making headlines – but unless you went to uni before 2012, it doesn't affect you yet.

Selling off student loans is a way for the government to bring in some quick cash. Private companies pay a fixed price to the government, and in exchange they are given the money from future loan repayments. That means the government gets the money now instead of having to wait for repayments, and the company can make a profit if the repayments are higher than the price it paid.

Some people are worried that the sale could lead to graduates paying more or having problems with paperwork. The government says that this won't happen: there won't be any change to how repayments are collected or how much graduates have to repay, and the loans still won't appear on credit reports. However, it could make it harder for a future government to make changes that help graduates pay less.

The sale will only affect people who started university in 2012 or earlier, but it's a useful reminder that the government can change how student loans work at any time. If you're thinking of going to university, make sure you check for the latest changes to the system. Our student finance resources and free student budget calculator give you an easy way to keep up to date.

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